“We are not totally out of the woods yet and this bill could still be tabled in the February sitting of Parliament, but for now it seems that it is not going to happen this week,” Burgess said.

“The government has other priorities at the moment and has come to the realisation that it does not have the numbers in the Senate. We know based on our discussions with the crossbench that there have been no discussions on the bill and no attempt to make any deals.”

Burgess continued that in the likelihood the government calls an early election, he said the bill may become an election issue.

“Given all the criticism this proposal has attracted, you would think it would be foolish for the government to go to the election with this tax in its current form or even try and re-introduce it after the election in its current form,” he said.

“If the polls are right, we are headed for a minority government, which means the Teals will probably have more influence and power and we know the Teals do not support this tax in its current form.”

However, he added if the legislation is not passed it will impact the government’s budget as it had forecast revenue off the back of the Division 296 tax.

“We are heading into Christmas with some uncertainty still about this bill, and it is likely to be debated in February if an election is not called before then,” he said.

“However, this delay also suggests that if it does get passed it will have to have a deferred start date as there won’t be enough time for funds to prepare. Additionally, the legacy pension regulations are hanging off the Div 296, so we won’t get those reforms until this is passed.

“If it is passed in February that leaves only four months or less for funds to take action, which is not enough. And what we do know is Treasury is keen to give legacy pensions enough time to make the necessary changes so they will not get caught under the Div 296 tax. That should be enough for a deferred start date.”

The Australian Financial Review newspaper reported on Tuesday, Finance Minister Katy Gallagher said it was a “big ask” to pass the legislation as it stands, but added that it will remain government policy if Labor wins the next election.

It was reported that Minister Gallagher said “Labor will not abandon” the policy and is “in negotiations to get as much of that through as we can”.